Decennial Revision of the Bank Act

Publisher:  Taskforce on the Churches and Corporate Responsibility, Toronto, Canada
Year Published:  1978
Resource Type:  Article
Cx Number:  CX840

A request to revise the Bank Act in regards to loans made to repressive government by private banks.

Abstract: 
This brief was submitted to the House of Commons Standing Committee on Finance, Trade and Economic Affairs in November 1978. The introduction outlines the purpose of this taskforce, stressing that some of its basic functions are to examine the human implications of decisions made by major corporations and "...to encourage support for policies which are socially beneficial while attempting to correct policies which they view as socially harmful". The purpose of this brief, as stated, is to have certain revisions made to the Bank Act.
The first issue raised in the brief is that of the five major Canadian banks lending financial assistance to repressive governments. The examples of South Africa and Chile are cited. The brief further explains that the Canadian Government has withdrawn its support from these countries and questions why the banks have not done the same in pursuit of alleviating the human misery and social injustices that exist there.
Secondly, the brief raises the question of non-disclosure by the banks of the amounts loaned and the dates loaned. Anyone requesting these answers is met with much resistance.
The following policy recommendations are made in order that the Canadian public be in a position to make valid judgements regarding such loans to oppressive nations:
1. That the Bank Act make provision for uniform and equitable public disclosure requirements of loans by Canadian banks, their subsidiaries and affiliates and by other financial institutions made directly or through consortia to foreign governments or agencies of foreign governments of amounts totalling more than $1 million.
2. That in the interest of public and shareholder accountability, Canadian banks and other financial institutions be required to disclose the amount and the dates of such loans and publish them as a matter of record.
3 That in order to preserve the principles of client/banker confidentiality and in order to safeguard the principle of competition, financial institutions should not be required to disclose such loans prior to 30 days following signed agreements.